The European Commission today launched legal action against Latvia over the administrative charges levied by the “Electronic Communications Office” (Elektronisko sakaru direkcija (ESD)), one of Latvia’s national telecoms regulators. The Commission is concerned that the administrative charges collected from companies for controlling the usage of the radio spectrum are not imposed in an objective, transparent and proportionate way. The Commission therefore has decided to send a letter of formal notice, the first step in an infringement proceeding, to the Latvian authorities.

“Administrative charges levied by State authorities in the telecoms sector should cover administrative costs alone, and must be imposed in an objective, transparent and proportionate manner," said EU Telecoms Commissioner Viviane Reding. “We are worried that administrative charges levied by Latvia's Electronic Communications Office may not comply with the EU telecoms rules that ensure fair treatment of companies, promote competition and benefit consumers."

In September 2007, the Latvian Government changed the administrative charge rates levied on companies by the Electronic Communications Office, one of Latvia’s national regulators in the telecoms field, which is responsible for ensuring electromagnetic compatibility in the usage of the radio spectrum. Money from these charges is used to finance the regulator's administrative costs.

Following this decision, in April 2008 the European Commission received a complaint about a significant increase (more than six-fold compared to the previous rate enacted in December 2006) in the rate charged by ESD for ensuring electromagnetic compatibility in relation to narrowband multi-channel mobile radio networks (TETRA).

Following correspondence with the Latvian authorities the Commission is concerned that this increase does not comply with the EU rules, which require that charges should be imposed on companies in an objective, transparent and proportionate manner. The Commission is also concerned that a government decision of September 2007 offering discounts of up to 50% on the electromagnetic compatibility charges to state defence and security institutions, for deployment of the state private electronic communications network and for companies implementing projects receiving state or EU funding could also breach EU telecoms laws.

The Latvian Government now has two months to respond to the letter of formal notice sent by the Commission. If the Commission receives no reply, or if the observations presented by the Latvian government are not satisfactory, the Commission can issue a reasoned opinion (the second stage in an infringement proceeding). If Latvia still fails to fulfil its obligations under EU law, the Commission can refer the case to the European Court of Justice.

Background

The EU's Authorisation Directive is part of the EU's regulatory framework for telecoms, and includes specific provisions on administrative charges levied on electronic communications companies by State authorities. These rules stipulate that administrative charges imposed on companies should in total cover only administrative costs incurred in the management, control and enforcement of the general authorisation scheme and of rights of use and certain specific obligations, and regulatory work. They should also be imposed upon the individual companies in an objective, transparent and proportionate manner which minimises additional administrative costs and attendant charges. Furthermore, national regulatory authorities that impose administrative charges are also under obligation to publish a yearly overview of their administrative costs and charges collected and they can implement appropriate adjustments.

A detailed overview of telecoms infringement proceedings is available at: